Get Out While You Still Can: Erik Gudbranson and the Sunk Cost Fallacy

Coming into this season, there was a whole lot of discussion about Erik Gudbranson. The pending unrestricted free agent was awarded a one-year $3.5 million extension in the summer after missing the majority of his first season with the Vancouver Canucks.

Gudbranson has been a polarizing player throughout his young career, with some lauding his physical, stay-at-home style, and others criticizing his horrendous possession numbers. The conflict between these two camps seems to be coming to a head as time ticks away on his one-year pact with the team, bringing on serious questions about what to do with the 6-foot-5 Ottawa native going forward.

On their TSN 1040 AM radio show on Friday, Mike Halford and Jason Brough broached this topic. Rightly, they pointed out that, as a pending free agent on a single year term, the Canucks will be able to re-sign him come January 1st. They then went on to state that the Canucks had but two choices: trade Gudbranson at the deadline, or re-sign him; they simply cannot lose him for nothing in free agency.

I’m here to tell you not only that the Canucks can lose him for nothing, but that’s it’s actually the second best option of the lot. What we’re looking at here is the Sunk Cost Fallacy. But before we get to that, let’s see how we got to where we are.

Acquisition

Gudbranson was Jim Benning’s big acquisition in the 2016 offseason, shipping former first-round pick Jared McCann to Florida in return, as well as swapping a few drafts picks which saw Vancouver lose significant potential draft value.

Losing McCann has been enough of a blow. The forward had five points in his first eight games with Florida so far this season and was beginning to push his way up the lineup before a lower-body injury forced him out of a handful of games. Those draft picks, though, and especially the second rounder, could really sting.

The term “second-round pick” hardly does it justice – it was, in fact, a 33rd overall selection, just barely outside the first round, where there is still a wealth of potentially impressive players. The Canucks drafted Kole Lind at 33 in 2017, and fans are rightly excited about his terrific start to the season. At the 2016 draft though, 33rd ended up being Rasmus Asplund, a Swedish centre who’s off to a fine start in the Swedish Hockey League with nine points in 17 games (only Elias Pettersson is having a better start to the season among under-20 players in that league). A couple of players selected shortly after that pick, such as Alex DeBrincat (Chicago) and Sam Girard (Nashville, since traded to Colorado), are already playing in the NHL and producing.

Fans around here are savvy, and popular opinion for a significant portion of the Vancouver fanbase was that the Panthers thoroughly fleeced Canucks general manager Jim Benning. Others were willing to delay judgement until seeing how Gudbranson played in Vancouver. Well, we’ve now seen Gudbranson play in Vancouver, and the results were have not been very appealing.

Results

In 179 minutes at 5-on-5 this season, Gudbranson has been one of the NHL’s worst defencemen. His shot shares are far and away the worst on the Canucks (aside from some very uncharacteristic, small sample Alexander Edler numbers), and the only other players that are even close are the ones that Gudbranson has spent significant time with this season. His shot attempt differential of minus-53 is more than double the next closest Canuck (Derek Dorsett, minus-24), and his CD60 of -11.5 means that the Canucks are allowing 11 and a half more shot attempts against than for, for every hour that Gudbranson is wandering the ice.

His five-on-five numbers are ghastly enough: only 23 defencemen with at least 100 5v5 minutes have a worse Corsi-for percentage right now. But that’s just the half of it. The Canucks have put up decent possession numbers this season, and are even top ten in the league in adjusted CF% and xGF% as a team. That really puts a dent in Gudbranson’s team and teammate-relative numbers, putting him near the absolute bottom of the league.

Player

CF%

FF%

SF%

GF%

xGF%

5v5

44.10

43.99

43.58

48.70

42.44

5v5 Rel

-11.33

-10.67

-10.32

-12.64

-13.95

5v5 RealTm

-11.12

-10.79

-11.71

-12.64

-14.70

Source: Corsica.hockey

His -11.3% relative CF%, for instance, is the second worst among all defencemen with at least 100 minutes at five-on-five. His relative Fenwick ratio is seventh worst, and his relative Expected Goals ratio is eighth worst. In each case, the culprit is his complete inability to suppress shots. The Canucks allow 15.6 more shot attempts every hour that he is on the ice, relative to when he is on the bench, as well as nearly half an Expected Goal. Again, that’s the relative difference every hour.

Worse yet is that he’s managed all of this in relatively sheltered minutes, lining up for roughly as many faceoffs in the offensive zone as the defensive zone, and ranking fifth on the Canucks regarding the average minutes played by opposing forwards (an approximation of quality of competition). He’s been a significant drag on whichever poor defenceman draws the short straw and has to babysit him on the ice, as evidenced by the following table, showing all d-men that he’s spent at least ten minutes with at five-on-five.

The analytics look terrible on Gudbranson, but he hasn’t looked any better to the naked eye. While some hoped that mid-season surgery to an injured wrist would improve some of his underlying numbers from last year, that hasn’t been close to the case. It makes sense: wrist surgery was never going to fix questionable decision making, poor reads, awkward pivots and transitions, and a noticeable lack of foot speed.

Any direction that you look at it, Gulbranson’s results have been brutal, which is pretty much in tune with what he’s accomplished in his career to date. Now, let’s double back and explore the idea of sunk costs, and how Gudbranson fits the bill.

Sunk Costs

The mere fact that the Canucks cannot recoup what they paid for Erik Gudbranson does not mean that they are forced to keep him.

Professional sports, particularly one as divided from educational avenues as hockey, tend to struggle with critical thinking, and in turn, lend themselves to a host of logical fallacies. Appeal to authority is a particularly common example. In the case of Gudbranson, the Sunk Cost Fallacy is most relevant.

A sunk cost is something that has already been paid for, and the payment for which cannot be recuperated. Having already invested something of value into this object, the emotional mind will go to great lengths to avoid feeling like the investment was wasted — even if that means sinking more capital into that investment.

The fallacious part of it is the lack of awareness that while you think you are simply trying to break even, you are really only making the problem worse.

Gudbranson is a sunk cost. Convincing yourself that you need to hold on to him just because you paid a hefty price for him does not help the situations — it just digs you deeper and deeper into a hole.

What this means

Obviously, I don’t want the Canucks just to lose an asset for nothing. We often talk about asset management, and with good reason. But asset management is still the point here; sometimes walking away is better asset management than doubling down.

For many, like Botchford, Halford, and Brough, the order of preference goes like this:

Trade > re-sign > walk away

I see the logic behind this preference, simply because walking away from an asset that you paid a hefty price to acquire is seen as a deadly sin.

My order of preference is similar, with an important distinction:

Trade > walk away > re-sign

As with most people, my first choice would be to get something for Gudbranson. If there are teams out there that still value what he brings to the table, and we know that there are, by all means, the Canucks should exploit that. The difference for me is that walking away isn’t my worst case scenario; re-signing Gudbranson is.

Part of this requires some context. I’m not necessarily saying that Gudbranson isn’t an NHL player; I just don’t believe he’s a top-four defenceman, and I think he’s drifting dangerously close to replacement level. He’s not worth $3.5 million a season, and he certainly won’t be worth the big, long contract he’ll inevitably get as a pending unrestricted free agent next summer. There’s an amount that I’d be willing to pay Gudbranson to play on the bottom pair, with no guarantee of a spot in the lineup each night. But it would be close to the league minimum – definitely not an amount that he or his camp would accept, which makes going down that avenue pointless.

Trade Expectations

I’ll make one more distinction from popular opinion, and that is to lower your expectations of a return. They aren’t getting McCann back. They aren’t recouping the value they lost in the pick swaps. The deal they made last summer is, and always will be, a loss. Canucks management can’t go into future trade negotiations with the mentality that they need to recover that lost value.

When the next option in line if a trade doesn’t occur is letting him go for nothing, you need to be willing to take whatever you can get for the asset. Even if you go into negotiations with higher expectations, they should be lowered accordingly as the search for a deal proceeds.

And, again, if a deal cannot be reached, then it’s time to cut bait and walk away. Signing this player for the salary that is going to command, and for any length of term, will absolutely come back to bite the Canucks, and should be avoided at all costs.

The $14 million that will be freed up as the Sedins come off the books after this season will look like a lot to start with, but healthy raises for the likes of Sven Baertschi, Brock Boeser, and Troy Stecher will be in the offing in the next two off-seasons, and any term longer than that could start to impede the first non-ELC contracts of players like Elias Pettersson, Jonathan Dahlen, Adam Gaudette, and Olli Juolevi, should they command any serious sum of money (and the hope is obviously that they will).

Having three of four million dollars tied up in a replacement level defender is never going to be a good look. Merely not having him on the roster at that salary next season is the very definition of addition by subtraction, both in terms of the salary cap structure, and the team’s ability to control the flow of play on the ice-ice.

So, as we approach the January re-sign window, and then the trade deadline, keep these things in mind. Getting something in return is still a priority, but if that isn’t feasible, they do not have to re-sign Erik Gudbranson, and they shouldn’t do it either.

If Gudbranson is on the Canucks’ roster next September, it means in all likelihood that a mistake has been made, and they could suffer from it for years to come. The only safe solution is to get out while they still can, be that on or before February 26th at the trade deadline, or on June 30th when the current contract expires.

What are your arguments against Burke’s opinion? It’s easy enough to attack the person presenting the opinion, but how about seeing the argument that says he’s wrong?

I think that Gudbranson is worth more than his hockey would indicate, simply because the NHL is still a jungle and some measure of pushback is necessary. I don’t have any idea how to quantify that, though, and haven’t seen anybody objectively attempt to.

JD has also assumed Gudbranson will command more money and term than is worth it to the Canucks. While imo he’s probably right in that, a scenario where Gudbranson is willing to accept a short term (a year?) with a premium over his normal value might come to pass. The question then is whether the Canucks can find a better use of that money over that term.

Canucks have to be careful, though. Luongo’s salary drops considerably after this season, then considerably more after 2018-19. He’s had a rough start to this season. If he retires the Canucks get hit with considerable recapture. Unless he plays out his contract in full (which would be surprising imo) they are probably best off the sooner he retires. For practical purposes it is easier to absorb $2.1 million for four years starting the season the Canucks have $14 million on two contracts coming off the books then it would be to absorb, say, $4.26 million per year for two years or $8.5 million in one season later on after their current prospects and elc players get raises.

Take that potential recapture and add it to paying Eriksson $6 million for another four seasons after this one and that is a lot of money off the salary cap before starting to pay the team’s best players.

The real issue will come from inability to know how much cap space will be available in the future if Luongo doesn’t retire this coming summer.

Imo the Canucks can’t afford to saddle themselves with another long-term, relatively high value contract. They could be forced to rebuild all over again by dumping good players for futures just to stay under the salary cap.

I am pro-Guddy only in so far as I believe hitting and that damned immeasurable grit have some value. Guddy brings value in those areas even if the fancy stats don’t measure them. Sure I wish he skated and moved the puck better, but I was sick of watching the California teams bully and hit the Canucks for the last bunch of years without any push back. I don’t have a comparable defence man to Gudbranson across the league. I would be fine trading, but they need to add some toughness in return.

Glad you brought up Loungo and his CAP recapture for retirement. I really hate that the NHL retroactively put in the “Loungo” clause citing CAP circumvention yet turn a blind eye when teams like Arizona are actively working around the CAP with the league’s blessing. Which brings me to my question; Do you think the Canucks will pick up Loungo again?
I don’t think the team has a choice but to pick him up and let him ride out his contract which dips to 1 million a year instead of letting him retire and being stuck with huge CAP implications.

Leave it to Jeremy to comepletely reverse my opinion of keeping Gudbranson lol. Touche kind sir. You ability to apply stats and analysis with an unbiased appeal never ceases to disappoint. Something tells me JD had a say in this article. ‘Dam, nobody is convinced by my opinions of Gudbranson…screw it, were sending in the big guns’. Sends Jeremy in to attack this head on like Rambo style.
Side note. After seeing the corsi comparisons of Del Zotto and gang….I legit envisioned Guddy as Chunk from the Goonies. Just a hulking mass of stupid lol.

Excellent work Jeremy! You’ve done a great job describing a typical strategic misstep most GMs seem to habitually make. The Sunk Cost Fallacy. Also known as good-money-after-bad. The Walk-Away is a smart viable business strategy and your application to Gudbranson is relevant. After all possible options to trade for value have been exhausted, the Walk-Away should be thoughtfully considered in all similar sub-par value player contract scenarios.

Game after game, the information on whether or not to keep or move Gudbranson builds and, currently seems weighted to suggest one path over the other. If it becomes apparent he’s not a fit, then we can only hope JB acknowledges this and begins laying the groundwork to move him for something. That should be pursued with vigour. If he can’t do it, then absolutely as Jeremy suggests, the next best option is walking away because that freed capspace AND freed d-spot is much much more valuable than the ‘anchor’ of the alternative. If another team wants to spend capspace on him after the fact, that’s their prerogative. Letting him go was our gain.

Again Jeremy, well done. Breaking through the static of convention is sometimes hard, but the fact you’re willing to do it is pretty cool by me.

For the first time in 3 years Benning/the Canucks .org have stocked assets to be used to trade up.
Gudbranson is a valuable asset that will improve the organisation when dealt.
As we saw with Luongo,Schneider,Kesler and Ehrhoff timing is critical.
Guddy is invaluable to a contending team.

My fingers are crossed that JB is very active trying to trade ‘all’ ill-fit assets for other value propositions in a timely matter. I agree timing is critical. Last year gave us a couple positive surprises in the Burrows / Hanson trades. I ready for more surprises.